Brands increasingly pick agencies for their DE&I credentials – but fail to follow through
According to a new report from the World Federation of Advertisers, an increasing number of brands say they consider sustainability as well as diversity, equality and inclusivity (DE&I) credentials as factors in the agency selection process. But when asked about the state of play in their current roster, few could tell you the policies and targets they have in place – and even fewer are actively ensuring diversity is baked into the day-to-day relationship.
There’s a demand on brands from consumers to show they are making positive steps when it comes to sustainability and diversity within their organizations. “Conscious about their own position and brand perception,” says the WFA, these demands are now being put on to the advertisers’ agencies.
While factors such as price, flexibility and measurement capabilities remain priorities in the selection process, in a survey of its members – representing a total annual spend of more than $55bn – the WFA found that 34% say that sustainability credentials are now considered when hiring a new agency. That number drops to 31% for diversity and further still for inclusion and equality, with 22% saying they are key factors in the decision-making process.
DE&I is being increasingly factored into the agency selection process
Despite it being on the checklist in the hunt for new agencies, brands are not yet asking for, or insisting, that their current agencies demonstrate specific accreditations for DE&I (eg Creative Equal’s Equality Standard or the 3% Certification), with only 22% saying that ‘All’ or ‘Most’ of their agencies have them. The overwhelming majority of brands (44%) simply don’t know.
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These figures are arguably too low when the industry has been encouraged by top advertisers including HP, Diageo and General Mills from as far back as 2016 to push their agencies on diversity targets.
Meanwhile, post-selection, there’s still work to be done on the client-agency model to ensure that it’s put into practice.
Many clients are placing these DE&I demands on their agencies without first getting their own house in order. The survey further found that less than a third of brands currently have their own targets in place for diversity and sustainability.
When asked if their organizations ensure that people from diverse backgrounds are included in the briefing process (from writing to execution), just 3% of marketers said they ‘always’ were, and a further 28% said they were ‘usually’ involved in the writing and reviewing process – but that dropped to 22% when it came to actual execution of the brief.
Shift to in-house continues apace
Overall, the survey painted a bleak picture on the current state of affairs between advertisers and their agencies. Three-quarters (75%) of the major multinationals surveyed said that they were only ‘somewhat satisfied’ or less with their current agency roster structure.
Additionally, nearly seven in 10 (69%) had recently made, or planned to make, changes to their roster to usher in a different structure. Only 25% of respondents were ‘very’ or ‘extremely’ satisfied with their current arrangements.
“There are many reasons why rosters need to be updated. Sometimes existing structures don’t work due to internal issues at the advertiser end. The accelerating rate of change in consumer behavior and digital usage makes it highly likely, however, that most rosters are heading for a period of constant evolution as brands seek new ways to be more effective with their marketing communications,” said Julia Kraft, senior manager for global marketing services at the WFA.
Amid this shift, more clients are looking to in-house. It found that 80% of respondents now have an in-house agency set-up of some shape or form, up from 57% in 2020, and a further 13% say that they are considering establishing one.